A battalion of the new Iraqi army refused to go to Fallujah last week to support US marines battling for control of the city, senior US Army officers said.

The incident has cast new doubt on US plans to transfer security matters to Iraqi forces. It occurred the first time US commanders sought to involve the postwar Iraqi army in major combat operations, and came as large parts of Iraqi security forces stopped carrying out their duties.

The 620-man 2nd Battalion of the Iraqi Armed Forces refused to fight last Monday after members of the unit were shot at in a Shiite Muslim neighbourhood in Baghdad. The unit was on its way to Fallujah, a Sunni Muslim stronghold, said US Army Major-General Paul Eaton, the official overseeing the development of Iraqi security forces.

The convoy turned around and returned to the battalion's home on a former Republican Guard base in Taji, a town north of the capital.

Major-General Eaton said members of the battalion insisted: "We did not sign up to fight Iraqis." He declined to characterise the incident as a mutiny, but rather called it "a command failure".

The battalion's failure to perform as US officials had hoped poses a significant problem for them. The cornerstone of the US strategy in Iraq is to draw down its military presence and turn over security functions to Iraqis.